Would you rather be rewarded for achieving a health-related goal, or penalized for not achieving it? Or maybe a combination of both would motivate you best? Much has been written about what works to change behavior, and the literature is inconclusive as to whether carrots or sticks are a better motivator. In Minnesota, the HealthShare local access to care program experimented with two approaches to wellness, and found that, for the population they serve, carrots are the more effective approach.
HealthShare is a multishare health plan that provides coverage to employees of small businesses that employ 50 or fewer employees and pay a median wage equal to or less than 350 percent FPL for a single person. The employer pays $60 per month per employee. The employee share is $67 per month for the Standard Option or $53 per month for the Wellness Rewards Option. Both options include primary, specialty, hospital, and emergency care, as well as pharmacy benefits.
There are three requirements for the Wellness Rewards Option:
- Enrollees must meet with a nurse care manager to set up wellness goals for the year.
- Enrollees must contact the nurse care manager within 12 weeks of this initial meeting to provide a progress update on their established goals.
- Enrollees must annually participate in at least two health-related classes, or two health-related activities, or one of each.
When HealthShare launched, members were given the choice at enrollment to choose either the Wellness Option or the Standard Option. The majority – 79 percent – chose the Wellness Option, primarily because of its lower monthly premium, lower co-payment rates, and higher dollar limit for pharmacy claims. Members who chose the Wellness Option but did not meet the three Wellness Option requirements were switched to the Standard Option.
The resulting churn from Wellness Option to Standard Option imposed a large administrative burden on HealthShare; records had to be updated to note each member’s proper plan enrollment. The nurse case manager faced missed appointments. Staff sent multiple reminders warning of the impending switch and explaining the requirements. Despite this, HealthShare staff fielded phone calls from members who were unhappy when they learned they were no longer qualified for the Wellness Option.
Based on this experience, HealthShare switched the default enrollment option to the Standard Option. Members then have the opportunity to earn enrollment in the newly renamed Wellness Rewards Option by completing the three wellness requirements. Although a lower proportion of members are now enrolled in the Wellness Option – approximately 50 percent of members – those who are enrolled are more likely to complete the requirements. As of the last quarter of 2011, HealthShare has seen a trend of a strong number of enrollees moving to the Wellness Rewards Option. HealthShare’s administrative costs have also dropped as fewer reminder notices must be sent and fewer members must be switched between options.
HealthShare staff shared two lessons from their experience. First, health behavior change is difficult, and people who are engaged in wellness programs are most successful when they have some internal motivation for change; financial incentives alone are not enough to change behavior. Second, it is important for coverage programs to maintain a positive customer experience. By using wellness programs as a carrot, rather than a stick, HealthShare is able to engage those members who are ready for change in a positive environment that supports their success.
Many thanks to Layla Lang, Jenny Peterson, and Dan Svendsen of HealthShare for sharing their experiences with us, and to Cara Bailey at the Minnesota Department of Human Services for her assistance with background information and editorial review.